Putin wants to enable grain exports to Ukraine

The Kremlin itself issued a statement on Saturday about the unhindered export of grain from Black Sea ports such as Odessa. It is reported from Germany that Russia is prepared to clear mines and allow ships access to Ukraine. According to the nations, the United Nations should see to that. Macron and Scholz urged Putin to consult directly with Ukrainian President Volodymyr Zelensky on the subject.

Own sake
Russia itself benefits greatly from opening shipping routes for the export of, among other things, grains, oilseeds (rapeseed and sunflower seed) and fertilizers. They too are heavily dependent on the Black Sea ports and ports in the Sea of ​​Azov. In a month's time, the grain harvest will start in the extreme south of Russia – the Krasnodar region – and Ukraine will follow shortly after. The silos are far from all empty and that causes problems. There is still a lot in stock, especially maize.

There has been talk all week about forming a corridor to enable grain exports. The western world accuses Russia of unleashing a global famine by blocking grain exports. Countries in Africa and Asia are particularly affected by the high price level and scarcity of products.

Wheat price plus almost €14
News of a possible lifting of the trade blockade also dominates product prices in the futures market this week. On Wednesday, May 25, wheat on the Matif fell to €404,50 per tonne, remaining just above €400. On Friday, the Matif closed again at €414,75 per tonne for the September contract. The weather conditions also play an important role. In France and Spain, despite recent rainfall, it is still bone dry and that costs pounds. In Central Europe - such as in Poland - it is also quite cold, which is not good for the crops. The US wheat price also increased again on Friday.

The news from Saturday afternoon will undoubtedly have a depressing effect on prices. Ukraine will be harvesting fewer grains this year, although that is still a point of speculation. Russia does expect a very good harvest, but analysts are currently taking into account that this can only be brought onto the world market in a limited way. Even if it can leave the ports, the question is whether countries will be lining up to do business with Russia and thus indirectly finance the war in Ukraine. Many Russian goods are now subject to sanctions introduced by the west. If the export ports open, those sanctions should expire, the Kremlin says in their statement.

Export ports shot up
It is far from that yet. Since the end of February, the port facilities for grain transhipment have not been spared either and have been largely destroyed by Russian forces. Mines have to be cleared and personnel, who are still fighting at the front, have yet to be found. The southeastern part of Ukraine is still a place where battles are fought. Shipowners must also be prepared to send ships to the country. That is also a concern.

French and German leaders also called on Putin to end the war and release detained Ukrainian soldiers. In turn, the Russian leader lashed out at the west and their supplies of weapons and other assets, which he says are helping to destabilize the region. A first and important step has been taken, but now action must be followed.